How Location Can Affect a Home's Resale Value
There are many factors which should be considered when purchasing a home, especially if it's a first home. One of those considerations should be the resale value. Many home-buyers anticipate moving on to a larger or better house in the future. The resale value of a home could make a great impact on how quickly it sells when it comes time to move out and move on. While there are no guarantees that a home will grow in value, there are steps which can be taken to maximizeize its resale value when it is time to move on.
One feature which can have the greatest effect on the resale value of a home can be summed up by the popular real estate phrase, "Location, Location, Location." This expression has been tossed around a lot, but what's the big deal, really? Location is extremely important if there is any intention to resell a home later. The idea is to purchase a house that will attract to other home-buyers in the future. Taking the time to carefully choose the best place can minimize losses in a down market, and maximize potential profits. Location is more than a place on a map, however. Here are some things to think about when choosing where to buy a home.
The City or Town. Before a home can be chosen, the city or town needs to be picked. Recognize that some locations are more desirable than others and for different reasons. Cities with abundant employment options or public transportation appeal to a wide range of people. Homes in upscale places are nice but tend to a specific group of possible home buyers. Homes in small towns, unless they are within reasonable driving distance of larger cities, have a smaller pool of potential home buyers. Carefully choosing the area in which a home is purchased can be a huge step in maximizing potential future resale value.
Economic Stability. Big city or smaller town, when choosing a community, it makes sense to buy in at a location with a viable and stable economy. In addition to having residential neighborhoods, there should be a healthy mixture of commercial and business districts either within the town or nearby. This not only ensures that there are plenty of jobs available, but also adds a source of income for the city to upgrade and maintain roads and city services. The long and short of it is, when it is time to sell the home in five, ten, or even fifteen years in the future, the area should be a desirable place to live.
The Community. What truly makes up a community is a variety of factors. Concrete things like highways, parks, and sidewalks can be the building blocks of a city. Additionally, organizations, restaurants, services, gas stations, and other places run by citizens help to create the community, too. If being close to conveniences like mass transit, local shopping centers, and easy highway access are important, make sure to look in places where these features are present. Any one or more of these amenities are popular with a majority of buyers and may have an effect on the resale value of a home.
Local Government Services. The services provided by the local government can have a huge impact on the sale of a home. Local governments are responsible for fire protection, police protection, road maintenance, and often sanitation and sewer services. They can also be responsible for more fun stuff like parks services, public libraries, and city sports teams. Smaller towns will have few amenities like these and will tend to have some services privatized. In particular, privatized fire protection services or no local police force presence can be a turn-off to potential home buyers.
Schools. Even home buyers that do not have school-age children or do not intend to have children must pay attention to the local school system. When it is time to sell the home, many potential buyers will have kids or plans for kids. One of the best resale factors in regards to education is school choice: either multiple available public and charter schools or private school options. Overcrowded schools could be a detriment. Plans for new school construction can be a boon. Additionally, schools with good scores on standardized tests will be preferred.
Property Taxes. If resale value is important, property taxes must be taken into consideration when choosing the location of a home. Property taxes may be higher in one town than another nearby city. This can sometimes affect whether potential homebuyers view a community as a desirable place to live. There are two sides of the coin to consider, however. Lower property taxes could mean a lot of savings, but often at the cost of the government services described earlier. On the other hand, higher property taxes obviously mean a resident will shell out more money, but they also often have the benefits of newer schools, well-maintained roads, and access to community services.
The Neighborhood Sweetspot. Most homes are located in residential areas, with the exception of places like lofts and condos in large cities. Within these residential areas, some lots are more desirable than others. For example, a house in the center of a neighborhood tends to be more attractive than a home on the edge of a neighborhood because that's where busier streets are inclined to be found. Busy streets are not kid, pet, or pedestrian friendly. Another thing to avoid is purchasing a home along a street that is used as a shortcut between two busier streets. Corner lots, likewise, tend to attract more street traffic. The middle of the block or on a cul de sac are popular locations.
The location of a home can have an incredible impact on its future resale value. Although its place on a map may be one factor, there are many more aspects of a home's location which should be taken into account. Before purchasing a house that will ever be resold, take the time determine if it is in a location that will appeal to future home buyers.
